M&C Saatchi: Advertisers failing to capitalise on Oz smartphone penetration

M&C Saatchi: Advertisers failing to capitalise on Oz smartphone penetration
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Australia leads the US and Britain with one of the highest smartphone penetrations in the world, yet advertisers are falling way short of leveraging this, according to M&C Saatchi’s mobile division.

The agency has fused data from eMarketer and Google/Ipsos to find that ad spend per Australian smartphone user is less than one-third of the level it has reached in the US and the UK.

While nearly two-thirds of the Australian population has a smartphone – compared with 56% in the US and 62% in Britain – just $6.87 is spent on mobile advertising per subscriber here annually, versus $22.70 in Britain and $22.30 in the US.

M&C Saatchi Mobile Asia Pacific managing director, Chris Steedman, said mobile ad spend “should be catching up to where the eyeballs are”.

According to Steedman, the reasons why it is not are a combination of inflated high costs of mobile media in Australia and strategy and execution that is less than optimal.

“I think poor strategy and execution are caused largely by the fact there are few businesses in Australia that specialise in mobile advertising and media. In many instances mobile is done by traditional agencies who merely tack it on to their offer,” he said.

“Poor planning and execution leads to poor results which don’t endear marketers to commit future ad spend to mobile, so it becomes a rather unvirtuous cycle.”

Steedman said mobile’s massive potential was highlighted last month by Facebook’s ­second-quarter results, as it generated $655.6 million from mobile ads in the quarter, 41% of its total advertising revenue, up from 30% a year earlier.

“Facebook’s success throws into sharp relief how Australian brand owners are failing to leverage the device in every consumer’s pocket,” Steedman said.

“In particular they are missing out on leveraging Facebook’s unmatched targeting and scale via mobile.”

Certainly, there is no lack of appetite for mobile advertising among Australian consumers, he added.

According to figures from IAB Australia, 54% of Australian mobile users now state they are as comfortable with mobile advertising as they are with TV or online advertising.

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